Desk Report: A Biden administration will seek to slow Beijing’s development of next-generation technologies in China by limiting the ability of American companies to invest in areas that could have military applications.
Such as advanced semiconductors, artificial intelligence, and quantum computing. In an executive order to be issued on Wednesday.
US companies will be subject to unprecedented new federal oversight that will investigate and possibly block some of their investments in China’s tech industry. The goal is to ensure that US cash does not support China’s military modernization and potentially endanger the United States.
The rules will not go into effect for at least a year, and there will be a public comment period so companies and other groups can consider new rules before they are finalized.
Representatives for the White House and the Treasury and Commerce departments could not immediately be reached for comment.
The administration’s initial plans to limit US investment were more comprehensive. But after months of dealing with the private sector, the new rules have narrowed their focus.
Some US officials have expressed concern that restrictions on the flow of US capital to China could be harmful to US companies and have negative effects on the local economy.
The Chinese economy – the second largest in the world with more than 1 billion consumers – is an important market for many American companies.
Earlier this summer, Secretary of State Antony Blinken, and Treasury Secretary Janet Yellen took separate trips to Beijing to help ease tensions between the United States and China.
In Yellen’s meetings with her Chinese counterparts, she has tried to reassure them that the executive order will be “very targeted.”
However, China’s ambassador to the United States, Xie Feng, warned that Beijing would retaliate. “The Chinese government cannot sit idly by,” Xie said at the Aspen Security Forum in July.
There is a Chinese proverb that says: “We will not act upon provocation, but we will not back down from provocation.” So China will definitely respond to us.”